2003: Starting with Foreign Trade

Chapter 832 A Man's Sports Car Dream (Seeking Monthly Tickets)

When viewed from the air, the Heysel circuit forms the triangle shape in the Lotus logo.

The 2.2-kilometer-long, 40-foot-wide track incorporates a variety of technical sections, including high-speed corners, hairpin bends, and long straights.

"This track belongs to Lotus, which means it belongs to us now."

After experiencing a lap on the track and taking a helicopter tour to overlook the Lotus factory, Heysel circuit, and surrounding scenery, Tan Jincheng and his group prepared to enter the Lotus factory.

The factory's reception area faces the test track, which is said to have been meticulously designed by the founder, who was a race car driver, pilot, and engineer.

The story of this legendary founder begins with a power drill and rises to fame through modifications.

"I heard that Tesla only had £50 in start-up capital when it was founded?"

Tan Jincheng asked about the current Lotus CEO, Michael Kimberly. According to information gathered from Proton, this successor is somewhat stubborn and arrogant.

As the birthplace of the Industrial Revolution, their ancestors were wealthy, but to this day, it's unclear what they're so arrogant about.

Car brands are almost all sold off. Take Lotus for example, which has been resold multiple times. By the time it came to Tan Jincheng, it was already the fifth owner besides the founder.

It's changed hands five times already, don't you CEOs bear any responsibility?

Back in the day, you were a sports car brand on par with Ferrari, and also kings on the F1 track.

However, in order to make the transition smooth, we still have to praise them. Since there's nothing to praise about their current achievements, we can only praise their history. This tactic is very effective for arrogant people.

"Yes, we only had 50 pounds at the time, but that was 50 pounds in 1952, which was a huge sum of money."

The new boss is young, but he knows their history, which makes Kimberly somewhat proud.

Tan Jincheng nodded. Although it was nothing for the start-up capital of a car company, £50 in 1952 was indeed a huge sum of money.

Surrounded by vast farmlands and forests, the Lotus Heigl factory is not large, covering an area equivalent to 1.5 football fields. In today's China, it would not be an exaggeration to call it a township enterprise.

Proton valued Lotus's 51% stake at only RMB 4.1 million, which is quite a bargain.

Almost every man dreams of owning a sports car. For Tan Jincheng, it would be worth it to own a sports car brand with decades of history for just 4 million yuan, even if he suffered heavy losses.

“People in that era had it tough. I have great respect for Lotus’s ability to achieve global fame in Heysel in the last century.”

“We at Weilai are a young company, but youth means vitality. I hope that Lotus, this 67-year-old man, can shine again in our Weilai.”

"Without changing the Lotus style, Lotus will develop towards electrification and intelligence in the future."

Lotus sports cars have always been known for their lightweight design. Having experience in Formula 1, they are adept at using carbon fiber as a material. Currently, Lotus's global sales are around 1500 units.

Tan Jincheng's wish is to triple Lotus's global sales to around 4500 units within five years, and eventually stabilize them at around 5000.

Kimberly made no comment on the new owner's statement, but maintaining an annual sales target of 5000 vehicles is not a low goal.

Just look at Ferrari's annual sales figures, the current king of luxury sports cars. Around 2015, Ferrari's annual sales were around 7000 to 8000 vehicles.

It is very difficult to increase sales to half of Ferrari's level within five years.

However, he was quite satisfied with the new owner's determination to revitalize Lotus. Tan Jincheng had learned about the young owner before his visit and found him to be a very remarkable person.

At less than 30 years old, he has consistently ranked among the world's richest people, making his experience even more remarkable than that of American Zuckerberg.

He had no control over how the new boss would operate, and he even knew that his time as CEO wouldn't last long.

"Once everything transitions smoothly, Lotus will build a factory in China. We will replicate the spirit of the Heysel factory, enhancing Lotus's global image while making China Lotus's second home."

"In addition, we also plan to separate Lotus from Proton and make it an independent subsidiary and sub-brand of Weilai Holdings. In the future, it may be listed on Wall Street; of course, it may also be listed in Hong Kong."

As Kimberly suspected, Tan Jincheng had not come to seek his opinion, but rather to inform him.

If he cooperates, he'll be given a dignified exit, retaining an advisory position and receiving a pension. If he doesn't cooperate, then he'll have to follow Musk's example.

In 2014, sales of Maodou S in Greater China fell short of expectations, and Manager Ma immediately fired the Greater China manager.

He took over Lotus, established a smart factory in China, pursued electrification and intelligentization, and built his own sports car brand.

Today's contact was just a brief glimpse. For the next two weeks or so, Tan Jincheng and his team will stay in Heisel to gain a deeper understanding of Lotus's product system and structure.

Another aspect is to explore the feasibility of building a factory in China and where would be a suitable location for it.

"Alas, what a pity. Tianjin was originally a good city, but now we have to choose where to put it."

Back at the hotel, Tan Jincheng pulled Li Xiang, Hu Zhengnan, and others to drink beer. The British food was just so-so, and tasted bland.

Heather is relatively remote, but the scenery is quite nice. It's just the wrong season to come. If it were the right season, there would be fields of rapeseed flowers, which is somewhat similar to Tan Jincheng's hometown.

"If it weren't for that accident, Tianjin would indeed be a better choice. It's a real shame."

It has a port, a complete industrial system, and is adjacent to the capital. Tan Jincheng also has factories there, so it has a certain foundation.

Unfortunately, an accident last month has completely blocked the city's path to development.

Jinye became Xiaojinzi. That accident really scared Ma Ge. WX's server was not far from the accident site at the time, and the Flash Motors Tianjin factory was also affected to some extent.

"If you ask me, it would be good to put Lotus in Jiangcheng."

These words were spoken by Li Xiang, and Tan Jincheng looked at him with some surprise: "Tell me your reasons."

"Currently, most of our industrial layout is in the Yangtze River Delta, and the only one left in the central region is Xiangcheng, which is relatively isolated. If we can build another factory and establish a brand in Jiangcheng, it will complement Xiangcheng."

As for why it wasn't placed directly in Xiangcheng, Li Xiang didn't say, but both he and Hu Zhengnan could understand.

Firstly, Xiangcheng is merely a historical issue and has never been a focus of the company's development. Secondly, if Tesla were to actually locate its factory in Xiangcheng, the positioning of the existing factory would become somewhat ambiguous.

"Another thing is that we have a good relationship with Dongfeng. If we were in Jiangcheng, we would receive some preferential treatment. Also, you have a good relationship with President Lei and President He. We also have quite a few connections in Hubei Province."

Tan Jincheng nodded repeatedly: "Another point is that Jiangcheng's higher education resources are quite good."

This did remind him that when he was in the EMBA program, some people, including Lei Jun, approached him to discuss investing in Jiangcheng. Lotus is indeed a very good opportunity.

“Okay, then let’s make Jiangcheng the most important city. I’ll go and check it out after I return to China.”

The three clinked glasses, and Tan Jincheng smiled at Li Xiang, saying, "Mr. Li, would you be interested in becoming the CEO of Lotus?"

He had never known how to best utilize Li Xiang. Li Xiang's current role was more like that of his advisor, and Li Xiang had no intention of starting another business for the time being, which was certainly advantageous to him.

However, in the long run, it is somewhat wasteful to put an excellent product manager in such a position.

Any excellent company, whether its founder or CEO, must be a product manager who understands users and can solve their needs. Tan Jincheng was able to make Weilai bigger and stronger largely because he himself was an excellent product manager.

As for cheat codes and such, at his current level, they are only useful in avoiding trouble in major events, and are not very useful in business operations.

In the same industry, everyone has their own information channels. What matters is nothing more than personal connections, financial strength, and marketing capabilities. Planning ahead is really useless; just look at Baidu.

Li Xiang was taken aback: "Me? Can I do it?"

Tan Jincheng's question came as a surprise, not only to Li Xiang but also to Hu Zhengnan, who was standing next to him. With a new CEO for Proton, Lotus, now an independent subsidiary, would surely also welcome its new CEO.

Within the company, there are various speculations about who will become the CEO of Lotus.

Hu Zhengnan had no intention of competing for this position. From the moment he joined the research institute, he knew that he was there to succeed Yu Liguo. The research institute was his stage, and besides, he already wielded considerable power.

There were many speculations within Wei Lai, some guessing Zeng Jixiang, and some even guessing Zhao Xinyi, but very few people would have thought it would be Li Xiang.

This includes Li Xiang himself.

Although he was deeply involved in Weilai's various decisions, he had always seemed to exist outside of Weilai's overall management system.

“Why not? If we’re going to build a factory in China, we have to use our own people and our own methods. The British way of doing things definitely won’t work. You understand the product and have a comprehensive understanding of Weilai, so you’re the most suitable person.”

Hu Zhengnan laughed and said, "Yeah, what's wrong with that? Can we do any worse than the Indians?" This remark drew a burst of laughter from the three of them. Hu Zhengnan understood the joke; he was actually referring to the Land Rover.

The Dai Ying family, with its century-old industrial foundation, is indeed impressive, that much is undeniable. However, their industrial system has become somewhat outdated. In this day and age, in a highly developed automotive industry, they're still boasting about being purely handcrafted.

Can something handmade be as good as something machine-made? You're really obsessed with handmade products. No wonder their car brands are almost all sold out.

Consumers want products with excellent quality and a great user experience. They might buy your century-old brand, but they certainly don't buy products that you hand-rub.

As a luxury brand, Land Rover's quality was so poor in the hands of the British that even the Indians couldn't stand it. After Tata bought it, they didn't use their local manufacturing plants but started doing it themselves.

With India's industrial system, they actually managed to revive Land Rover. The quality of Indian-made Land Rover is even better than that of British-made Land Rover. Isn't that amazing?

Once Land Rover came into Chery's hands, domestic consumers generally believed that the worst quality vehicles were imported, while the best quality ones were domestically produced.

"That's exactly the point. I wouldn't dare rely on the workers at the Heysel factory for Lotus's globalization strategy."

The Heysel factory will certainly be preserved, but it will mainly serve as a symbol, engaging in design and research work. As for producing a specific car model, we'll have to bring in our own people to manage that.

"Give it a try. That's why I brought you here. Starting tomorrow, you'll get into the role and learn about Lotus's product system in all aspects."

Tan Jincheng's plan is to update and iterate on the existing models, to create one or two gasoline sports cars, one or two pure electric sports cars, and an SUV model similar to the Porsche Macan or Cayenne.

There is a top-of-the-line sports car, which is quite expensive, and is used to show off.

The remaining mainstream models will be priced between 80 and 100 million yuan in order to increase sales.

"Then I'll give it a try? Please be lenient with me if I don't do well."

Li Xiang rubbed his hands together, raised his glass, and said that the opportunity was right in front of him, and he couldn't possibly miss it. Lotus was an independent subsidiary, and its layout in China could be said to be starting from scratch, which was no different from starting a new business for him.

It's still quite challenging.

"Haha, don't be so pessimistic. Can you do any worse than the British? I believe in you."

"Come on, let's raise a toast and wish our new CEO of Lotus great success."

Although the company has gone public, Tan Jincheng still continues the management style he used before the company went public. He makes all the major decisions and personnel appointments himself. Forget about shareholders' meetings.

Friday, September 6st.

Tan Jincheng and his team officially began a comprehensive investigation and audit of Lotus. Lotus, this luxury sports car brand, is quite peculiar; it has basically never been profitable since its inception.

To be honest, Kimberly has been quite unlucky. He has only been the CEO of Lotus for a year. In 2014, he was the CEO of Peugeot. Since becoming the CEO of Lotus, he has been called the unluckiest manager.

To make matters worse, Lotus changed owners after he had only been CEO for a little over a year.

Tan Jincheng's first act upon taking office was to announce the transfer of Lotus's F1 team, a move that caused a huge reaction within Lotus.

"Damn, what kind of wealth do they have? They even support an F1 team. How many car brands can afford to support an F1 team?"

路特斯的F1车队是雷诺车队的前身，车王舒马赫可是在1994年跟1995年为车队拿过车手总冠军，车队本身1995年F1车队的总冠军。

Renault acquired the Lotus team in 2000 and renamed it the Renault team in 2002. Alonso helped the team win the championship twice more, in 2005 and 2006.

However, the team's intangible assets remained with Lotus, and it was later renamed Lotus F1 Team.

In short, the Lotus F1 team has a glorious history for Lotus, and the new owner, who has only been at headquarters for two or three days, has already decided to sell the F1 team.

"Open source and reduce expenditure, open source and reduce expenditure. Since we can't open source in the short term, we can only reduce expenditure."

Maintaining an F1 team requires a lot of money. According to Tan Jincheng's understanding from the financial report, the budget for this F1 team alone is not low this year, but the number of advertisers is limited. The expected loss this year is at least £5000 million.

Currently, the average exchange rate between the British pound and the Chinese yuan is 1:10.38, which is over 5 million yuan.

Tan Jincheng could afford to lose 5 million, but he had no intention of spending 5 million every year to maintain a racing team. In the mobile internet era, F1's influence was far less than it had been in the early 2000s.

On December 29, 2013, Formula One legend Michael Schukhe suffered a fall while skiing and became a vegetable, which basically signaled the end of F1's popularity.

"Michael, go and calm down the company's employees. Also, contact Renault; I'm planning to give this thing to them."

Essentially, Tan Jincheng is still a pragmatist. His companies, including Flash, spend a lot on marketing every year and invest a lot in sponsoring sports events, but all of this is based on the premise that he can see the returns.

Therefore, getting rid of this burden is imperative. This alone could save Lotus hundreds of millions of dollars in expenses every year. Keep in mind that Lotus's total revenue for the entire year of 2014 was only $2.24 million.

Of the more than 1 billion in revenue, half of it was lost on the F10 team.

Kimberly gave a wry smile and helplessly spread his hands. As a professional manager, he absolutely agreed with his boss's decision. Given Lotus's current situation, it simply couldn't afford to support an F1 team.

However, previous bosses, for various reasons, were never able to completely get rid of this burden.

Tan Jincheng smiled and said, "We need to move forward with a light burden and get the company profitable as soon as possible so that we can gain recognition in the capital market."

Not being listed on the stock exchange does not mean that you do not need financing. Financing methods such as issuing bonds can be carried out even when a company is not listed. If you want to gain the recognition of the capital market, you have to produce impressive financial reports.

Otherwise, he would have to put his own money into it, just like he did when he first started his business.

Rather than building factories or setting ambitious goals like increasing sales to four or five thousand vehicles per year, the first step right now is to make Lotus profitable as soon as possible.

This year, Lotus will launch an "EVora400" model in Europe, and promoting the new car with a light budget is the most important thing.

"Another thing is that we need to find a way to increase our production capacity. Currently, our production capacity will definitely not be enough once we open up the Chinese market."

"I will consider studying this."

Dai Ying's car production capacity is calculated on a weekly basis. Currently, Lotus's weekly production capacity is only 45 vehicles, and its annual production capacity is no more than 2000 vehicles. If a certain model sells well, then the production capacity will not be enough.

Lotus's interior is touted as being entirely handcrafted, and the efficiency of that process left Mr. Tan (the owner) quite anxious.

He doesn't object to this kind of promotional gimmick, nor does he object to the so-called handmade craftsmanship, but some parts could be done more efficiently and don't necessarily have to be handmade, but he just insists on doing it this way.

Li Xiang chuckled to himself; the boss was having Kimberly play the bad cop.

However, this matter can only be brought up by Kimberly. They have just arrived at the factory and are already raising these issues. Not to mention whether this will cause resentment among the employees, it may even attract the attention of the labor department.

Kimberly plays the bad cop, and the boss comes out to play the good cop when it's time.

For example, a raise or something would solve the problem.

On the other hand, Tan Jincheng's current acquisition behavior, which dares to make big moves right from the start, also proves that he is becoming more and more confident. It should be noted that in the initial acquisition process of Weilai, the first thing he did after taking over was to raise salaries, which was nothing more than a helpless move to win people's hearts when he lacked the foundation.

Because of the time difference, while Mr. Tan was reorganizing Lotus and pursuing his dream of owning a sports car, the domestic stock market, which had already closed, was in a state of utter despair.

Today is the fourth day of the fifth lunar month. On the last trading day before the Dragon Boat Festival, the A-share market witnessed its first-ever true "thousands of stocks hitting their daily limit down".

The Shanghai Composite Index plummeted 6.42%, marking its third-largest drop this year. A record 1088 stocks hit their daily limit down, resulting in a loss of 9.24 trillion yuan in market capitalization in a single day.

It's equivalent to losing both PetroChina and ICBC.

1088 stocks hit their daily limit down, 1268 stocks fell by more than 9%, and 1454 stocks fell by more than 8%. All sectors were down, and only 125 stocks in the Shanghai and Shenzhen stock exchanges closed flat or in positive territory.

As retail investors jokingly put it, there aren't enough rooftops to go around.

Zeng Jixiang is also extremely busy today. From the 15th to the 19th, the A-share market plummeted by 13.32%, the largest single-week drop since June 2008, a stock market crash that occurs only once every seven years.

He had to take seriously the things his boss had specifically instructed him to do before leaving the country. As the secretary of the board of directors of Weilai Group, he spent almost the entire week in the securities department.

Weilai's stock price has fallen quite sharply this week. Although it did not hit the daily limit down today, it has fallen below 100 yuan, closing at 98.07 yuan.

It took several months for the stock price to rise above 100 yuan, but only a few trading days to fall below 100 yuan. As the company secretary, he has witnessed the madness of the stock market in the past few days.

The phone number for Weilai Securities' department is publicly available, and the phone has been ringing non-stop for the past few days with all sorts of bizarre greetings. In addition, the investor interaction area for the company's stock is also filled with all kinds of questions.

"Before the boss went abroad, he told us to try our best to appease the investors, but how are we supposed to appease them after this stock market crash?"

He really wanted to appease them, but he couldn't. Not long after the market closed, the comments section was flooded with messages, including one claiming that their cost basis was 150 yuan. Damn it, our stocks never even reached 150 yuan at their highest point. How did you manage to do that?
(End of this chapter)